Sport retailers cleared by fraud probe but individuals are still under scrutiny

SPORTS Direct and JJB Sports have been cleared by a fraud probe, although investigations into unidentified individuals continue, the two companies announced yesterday.

Britain’s Serious Fraud Office (SFO) had been investigating both sporting goods retailers over possible price fixing and fraud.

“No charges are to be brought against the companies or any companies within their corporate groups. The Serious Fraud Office’s investigation into individuals continues,” Sports Direct said in a statement that was later echoed by JJB Sports.

The probe was carried out under the Competition Act, which covers cartel offences against companies.

Sports Direct, Britain’s biggest sporting goods retailer and which is controlled by Newcastle United soccer club owner Mike Ashley, declined to identify the individuals being investigated.

“This announcement giving Sports Direct a clean bill of health regarding the SFO investigation is what investors were hoping for,” said Singer analyst Matthew McEachran.

“The shares have run up in anticipation of this result though. Furthermore, with the investigation into individuals still ongoing there remains some risk and uncertainty to the investment case,” he said.

Sports Direct International’s brands include Dunlop, Slazenger and Lonsdale.